The agency cited low debt, increased tax revenues, high reserves and sound policy from the Bank of Russia managing the level of inflation as the key factor in the upgrade.
With a strengthening ruble and falling interest rates, Russian government debt proved an attractive purchase for foreign investors last year, with non-residents buying a record $22.2 billion of Russian government bonds in 2019, data from the central bank shows.
New data released last week also showed Russia’s international reserves have now climbed to their highest levels since before the 2014-15 economic crisis. Russia holds $557 billion in foreign currencies and gold, slightly up on levels last reached before the Central Bank spent billions trying to stave off the ruble’s rapid depreciation at the end of 2014 — a policy which cut reserves to $350 billion.
The upgrade by Scope Ratings follows a similar move by Fitch — one of the Big Three credit rating agencies alongside Moody’s and S&P — last summer.
S&P left its own rating of BBB- unchanged Monday, with an outlook of “stable”, meaning its analysts do not expect the economic picture to change soon, unless something dramatic occurs, such as a significant tightening of sanctions against Russia.
Moody’s, on the other hand, expressed “some uncertainty as to the direction of [Russian] economic policy” following the abrupt change in government which happened this week but maintains a positive outlook on its overall trajectory.